Congress got results, but we'll need time to reflect on their quality

December 23, 1985

By Richard A. Nenneman

The last two weeks of the 1985 session of Congress have given both the political analysts and the economic pundits plenty to write and talk about. Deadlines have an amazing way of producing action, not only among journalists but in legislative bodies as well. One cannot tell for sure whether either the Gramm-Rudman bill, mandating a balanced budget in five easy steps to 1991, or the House version of tax reform passed last week is a real step of progress. But the need to wind up the first session of the 99th Congress did produce results.

This space has been critical of both measures in past weeks. William H. Gray, the Pennsylvania Democrat who is chairman of the House Budget Committee, wrote in an op-ed column in The New York Times last week, ``There is no evidence whatever that President Reagan's understanding of the danger of deficits and the need for revenues has increased. The President will send Congress another politically unrealistic and unacceptable budget next month. We will not get Presidential leadership to raise revenues a long with spending reductions; we will get stalemate and institutional chaos.''

One hopes Mr. Gray is overstating the problem. Moreover, the lack of action on the deficit also lies partly at the door of Gray's institution. But the danger is very real that the same gridlock that has existed so far in the Reagan years regarding the relative priorities of defense spending, domestic programs, and the level of taxation will prevent an agreement on the shape of the 1987 budget. Then, with Gramm-Rudman about to take automatic effect, Congress may take another look at what it has done and back off. But, in backing off from Gramm-Rudman, would it come any closer to a balanced budget?

The tax bill's fate is also difficult to envision. Some elements of the reform are positive -- such as taking more very low-income families off the tax rolls entirely. But its anti-business aspects in an economy trying to adjust to new worldwide competition won't go well with Senate Republicans. If the Senate produces a bill more in line with Mr. Reagan's thinking, it is doubtful a Democratic House would pass it. On the other hand, if a compromise bill is almost like what came out of the House, the Pres ident will face the hard choice of seeing his main domestic initiative in this term severely twisted and even scuttled (the latter if he vetoed it), or signing a bill that doesn't achieve the kind of reform originally proposed.

Meanwhile, we cannot let the year come to a close without noting that, while this legislative process has been going on endlessly in Washington, the real world of big corporations and just plain folks has been going about its business all year long, too. The economy has continued to grow, more slowly than in 1984 but still at a decent enough rate for this stage of a business expansion. The nation's companies continue to adjust to competition from imports and to such global phenomena as the oil price de cline.

These adjustments are not all without some pain, to corporations or to individuals. If Congress had been more concerned about the budget deficit a few years back, much of the trade deficit that has now become chronic could have been avoided. Yet it is remarkable, given the degree to which major manufactured imports have become a way of life for most Americans, how much the adjustment to this change has been accommodated by a free-market system.

Unemployment is at the lowest level in many years and personal income in the aggregate is at an all-time high. This masks the fact that real family income for the last decade has grown little, if any. What the system has done, though, is provide a constantly growing labor force without lowering the general standard of living. And that, at a time of global economic stagnation, is no minor accomplishment.

Next up

Here are more stories that look at the news with empathy, insight, and hope.